Branding Strategy, Route to Market, Exclusive Global Distributor.

1. Mark Harai
CTO/CIO
iSales Strategy Inc.
www.isalesstrategy.com

2.  The US ranks 3rd in global tobacco
consumption next to Russia & China
 The US accounts for 5.38% of the
worlds tobacco market with China
holding the largest share at 38.5%
 The US Tobacco Industry generates
$110 Billion in revenues annually,
producing a net industry profit of $35
Billion
 Smoking Incidences have declined
over the years, but has stabilized at
the 23% range
 There are 60 Million Smokers in the
US market
 The Biggest Tobacco Player in the US
is Philip Morris International, based in
Lausanne, Switzerland

3.  Tobacco companies are the most
profitable corporations in the world,
despite tighter regulatory mechanisms
 Stock Price of tobacco companies have
grown by 15 times in the last 10 years
 Higher profit margins are driven by
consumption and product profit mix
 Core driver of tobacco products are
PRICE & QUALITY
 There is an increasing incidence of Legal
Age Smokers from 18 to 35 years old
 Better technology in tobacco products
boost consumption in spite of higher
taxation rates
 Highest Individual Per Capita Consumers
are those countries that formerly
belonging to the Soviet Union &
European Nations

4.  China Tobacco owns 40% of the worlds tobacco
industry
 China Tobacco is the most profitable tobacco
company in the world
 China Tobacco is looking to expand in the North
American Market
 Shanghai Tobacco is the Global Marketing and
Manufacturing arm of China Tobacco which is
based in Hong Kong
 China Tobacco is the primary source of
international tobacco products for Shanghai
Tobacco

5.  Shanghai Tobacco is looking for a distributor in the US
 Focus is primarily in setting up distribution and presence
for the identified brands
 Company in charge of endeavor is iSales Strategy Inc., a
global management consulting firm dedicated in setting
up product presence in international markets

7.  Premium Cigarette at the most affordable price
 Charcoal Filter Technology that eliminates odor of Primary & Secondary Smoke
 Product Quality and taste is far better than the Marlboro or any of the leading brand

10. • Charcoal Filter Technology
(Eliminates smoking odor
of second hand smoke)
• Western Blend
• Available in Menthol &
Non-Menthol

12.  71,958 Supermarket Retail Stores
 320 Million Total Population
 60 Million Smokers
 285 Billion Stick Market Annually
 Average Cigarette Price per Pack: $7.20

17. Shanghai Tobacco Plan
0.5 % of Total U.S Cigarette Market
$552 Million Annual Business

22.  Shanghai Tobacco Cigarettes are 46% Cheaper - and far better
Quality than any premium brand
 Price Advantage Translates into $552 Million Annual Business
 Shanghai Tobacco Products Provides Higher Profits for the
Distributor and Retailer

27.  Average of $3.89 lower price between Shanghai Tobacco products
and other brands
 Translates to average of 218% difference (varies per state)
 New York, Illinois & Massachusetts are States with greatest
difference of between 300% to 450%

30. STEP 1
• Select a State that you want to develop and agree to become a Distributor of Shanghai
Tobacco Products.
• Key is familiarity terrain & trade channels within the geography selected.
• Any business entity or entrepreneur who has the 5C’s (Capital, Connection, Channel,
Commercial Enterprise & Character)

31. STEP 2
• Sign & Agree with the Distributor Contract set up by iSales Strategy Inc.
• iSales Strategy Inc. is the global management consulting firm handling the expansion of
Shanghai Tobacco Inc.
• Establish a Business Pipeline, Distribution Sales Plan, Market Penetration Marketing Plan
& Trade Marketing Development initiative with iSales Strategy Inc. for the chosen State

32. STEP 3
• Prepare the Initial Stock Purchase Plan for the Distributor Program
• Minimum of 1 Container Purchase (500 Cases of Shanghai Tobacco Products)
• Initial Inventory Capital Outlay for 500 cases = $320,000
• Shipment Timeline is 2 weeks
• Terms are Cash via Wire Transfer to iSales Strategy Inc. Bank Account
• All U.S Taxation Requirements, Import Duties & State Registration shall be the
responsibility of the distributor assigned
• Marketing Budget for State Trade Efforts shall be parallel with the stocks purchased &
Managed by iSales Strategy Inc.

33. STEP 4
• iSales Strategy Inc. shall be active in the distributor engagement process with stock replenishment
always coursed through the company.
• Stock Replenishment will be a minimum of 1 Container. Payment Terms: CASH before delivery
• iSales Strategy Inc. will be responsible for the market development initiative of Shanghai Tobacco and
is tasked to manage the Marketing Strategy of the latter
• Distributors will have the free hand and authority to sell the products as they see fit. iSales Strategy
Inc. will function as a strategic guide and important advisor to the operation
• iSales Strategy Inc. will disburse and control the marketing fund for the U.S market. Deployment of
which shall be in line with distributor business size

34. STEP 5
• Distributor is expected to achieve targeted numeric and weighted distribution in the U.S
Market
• Distributor assigned to the State shall have a fixed term of 2 years which is renewable
depending on the agreement between iSales Strategy Inc. & the Distributor Company. This
contract though can be prematurely terminated if the conditions or terms of reference are
not met or upon agreement between the 2 parties.
• Only 1 Distributor can be assigned per State. A distributor though can own 2 or more
States as long as the stock purchase is made in line with the minimum requirement.

39.  To support 0.5% of the Tobacco Market in the U.S, a total of $38.4 Million
worth of Stock Inventory is needed at the minimum
 To Start the business, $16 Million is needed to cover all the States in the U.S
market

40.  Tobacco is a Highly Lucrative &
Profitable Category
 High Product Profit Margins & Low
Cost of Business Operations
 Long Term & Sustainable Business
Model
 Overall Product Advantage versus
established Industry Market
Players (Price & Quality)
 Opportunity to venture into other
products & services

41.  Set up a Distribution Agreement with iSales Strategy Inc. (www.isalesstrategy.com)
 This business is only for a chosen few
 Provide the Initial Capital Requirement & other business essentials
 Operate & Grow the Tobacco Distribution Business